If you need additional funding after exhausting federal loan options, or if you can get a lower rate (especially compared to graduate and Plus loans), there are some steps you can take to get the best private student loan rates:
- Review your credit report: Check your credit report for errors that might be impacting your credit score. Have mistakes corrected to potentially improve your score before you begin applying for private student loans.
- Improve your credit score: The best private student loan rates are made available to those with good or excellent credit. Take steps to improve your credit score by making on-time payments and reducing your debt.
- Look for discounts: Some lenders offer an interest rate discount if you sign up for autopay. Additionally, you might be able to get a discount if you have other accounts with the lender.
- Add a cosigner: If you don’t meet the lender’s requirements for the lowest interest rate, consider finding a cosigner. A cosigner with good credit and a higher income might be able to help you qualify for a lower interest rate. Find out if the lender offers a cosigner release after you make a certain number of payments.
Does the One Big Beautiful Bill Act affect student loan rates?
The One Big Beautiful Bill Act, H.R. 1, doesn’t impact the formula related to federal student loan rates. Federal student loan rates remain set according to a law passed by Congress, and, presumably, Congress would need to pass a new law to change how federal loan rates are set.
Private loan rates are influenced by market conditions and set by private lenders based on their own criteria, usually with the help of a rate index. As a result, H.R. 1 doesn’t have a direct impact on their rates. However, some of the policies enacted by the One Big Beautiful Bill Act, such as new lifetime borrowing caps for some graduate students, could affect the market and result in changes to private student loan rates.
Continue to compare lenders and rates throughout your college career since you typically have to re-apply for private student loans each academic year.
FAQ
Are federal student loan interest rates fixed or variable?
Federal student loan rates are fixed, set by a formula each year.
When could I refinance my student loans to get a lower interest rate?
If you meet lender requirements and could get a lower interest rate by refinancing, you can go through the process at any time after your loans are disbursed.
How often do federal student loan interest rates change?
Federal student loan rates change once a year. Student loan rates are set from July 1 until June 30.
Do private student loan rates vary between lenders?
Yes, private student loans vary according to lender requirements. Each lender determines its rates based on business goals, market conditions and the borrower’s financial traits.